ContiTech details 2014 expansion investments

HANOVER, Germany—ContiTech A.G., part of Continental A.G., has announced that it invested about $203 million in new plants and locations worldwide in 2014.

“We reinforced our presence in Asia because we want to be where our customers are,” outgoing ContiTech CEO Heinz-Gerhard Wente said at a press conference at the Hanover Messe industrial technology show on April 14.

“In China, we have opened a hose line plant in Hanghzou and a production facility for industrial belts in Sanmen. We have expanded production of air springs in South Korea.

“We have also made investments in Germany (gas power plant in Northeim), Slovakia (production and research for vibration elements), Russia (hose line production in Kaluga), and Peru (sales office for conveyor belts in Lima),” added Wente who is retiring at the end of April to be replaced by Hans-Jürgen Duensing.

Wente added that the integration of Akron-based rubber product manufacturer Veyance Technologies Inc. is high on ContiTech's agenda for 2015.

On the financial front, ContiTech reported a decrease in operating income of about $30.8 million in 2014, with the figure dropping to about $460.4 million in 2014 from about $492.7 million 2013—despite a 1.3 percent rise in sales to about $4.15 billion.

“We are thoroughly satisfied with this result and the continued double-digit return on sales. Particularly in light of the negative developments in certain sectors of relevance for ContiTech,” Wente said.

Wente stressed that costs associated with the integration of the Veyance business were included in the 2014 results.

“Continuing low commodity prices resulted, in particular, in a significant decline in investment in the mining industry in 2014 and had a negative impact in the conveyor belt group. Here, we had to absorb a decline of about $70.2 million alone,” Wente said.

“However, we were able to offset this with increased sales in other business units. Benecke-Kaliko and the Power Transmission Group, in particular, with sales increases of about $81.9 million and about $38.2 million respectively, made above-average contributions toward this.”